USD/JPY: Bears eyeing a test of hourly 200-SMA, BOJ eyed

The bearish pressure behind the USD/JPY pair intensifies in mid-Asia, knocking-off the rate to fresh two-day lows of 114.27, with all eyes set on 114 levels – a key confluence zone of hourly 100 & 200-SMA

The major reversed Friday’s rally after the yen was sold-off into increased bond-buying plans announced by the BOJ. The yen jumped back on the bids after two straight days of declines, as risk-off remains at full steam after Trump’s travel bans fuelled concerns over his protectionist policies and its impact on global trade.

The USD/JPY pair dives further into the red zone as the greenback continues to extend losses versus its main peers amid the US political and economic worries, following Friday’s Q4 advance GDP report showed that the US economic growth slowed more than expected, coming in at 1.9% versus 2.2% estimate.

The spot was last seen exchanging hands at 114.31, struggling near daily troughs, down -0.70% on the day. Focus now shifts towards the US dataflow due later on the day, while Tuesday’s BOJ meeting will provide fresh impetus on the yen.

USD/JPY Technical levels to watch 

The major finds immediate resistance at 114.55 (20-DMA). A break above the last, the major could test 114.73 (daily pivot) and 115 (zero figure) beyond the last. While to the downside, the immediate support is seen at 114 (1h 100 & 200-SMA) next at 113.50 (psychological levels) and below that at 113.02/01 (Jan 26 & 25 low).